Question 1

Consider the following scenario to answer the next  questions: Two friends, Monica and Chandler, enjoy baking bread and making apple pies. Monica takes two hours to bake 1 loaf of bread and one hour to make 1 pie. Chandler takes four hours to bake 1 loaf of bread and four hours to make 1 pie.
-What is Monica's opportunity cost of baking 1 pie?

Accepted Answer

A)  2 pies 
B)  1 pie 
C)  1 loaf of bread 
D)  1/2 loaf of bread 
E)  2 loaves of bread

Question 2

Mikhail and Stefan are both artists who can create sculptures or paintings each day. The following table describes their maximum outputs per day. Use this table to answer the next  questions 
-What is Mikhail's opportunity cost of a sculpture?

Accepted Answer

A)  2 paintings 
B)  1/2 painting 
C)  3 paintings 
D)  1/3 sculpture 
E)  1/2 sculpture

Question 3

The figures below depict the production possibilities frontiers PPFs) for two people who can allocate the same amount of time between building wooden boats and solving crimes. Refer to these figures to answer the next  questions.
 
-What is DiNozzo's opportunity cost for solving a crime?

Accepted Answer

A)  20 solved crimes 
B)  30 solved crimes 
C)  5 solved crimes 
D)  1/20 of a boat 
E)  1/10 of a boat

Question 4

A graph that shows the maximum attainable combinations of two goods when society efficiently uses its productive resources is called

Accepted Answer

A)  a production possibilities frontier PPF). 
B)  a supply curve. 
C)  opportunity cost. 
D)  a consumer demand curve. 
E)  absolute advantage.

Question 5

$\text {Refer to the following table to onswer the next five questions.}$
$\begin{array}{llc} 
&{\text { New York Pizzas Philly Cheesesteaks }} \
\hline \text { Jay-Z } & 40 & 120 \
\text { Solange } & 50 & 125 \
\hline
\end{array}$

-Given the same quantity of resources, what is Jay-Z's opportunity cost of producing a New York pizza?

Accepted Answer

A)  5/2 Philly cheesesteaks 
B)  1/3 Philly cheesesteak 
C)  3 Philly cheesesteaks 
D)  120/125 New York pizza 
E)  4/5 New York pizza

Question 6

When testing a model rocket on a campus quad, which of the following would be an endogenous factor?

Accepted Answer

A)  the current wind speed across the quad 
B)  the quad's elevation and air pressure 
C)  the extent of precipitation 
D)  the gravitational pull of Earth 
E)  the size of the rocket engine

Question 7

The ability of one producer to produce a good at a lower opportunity cost than another producer is called

Accepted Answer

A)  a normative statement. 
B)  a zero-sum game. 
C)  absolute advantage. 
D)  comparative advantage. 
E)  the law of increasing relative cost.

Question 8

Economic growth is represented on a production possibilities frontier PPF) by the PPF

Accepted Answer

A)  getting steeper. 
B)  getting flatter. 
C)  shifting inward. 
D)  shifting outward. 
E)  rotating downward.

Question 9

The figures below depict the production possibilities frontiers PPFs) for two people who can allocate the same amount of time between making pizzas and making stromboli. Refer to these figures to answer the next questions.
 
-What is Kenzi's opportunity cost of making 1 stromboli?

Accepted Answer

A)  30 pizzas 
B)  20 stromboli 
C)  2 pizzas 
D)  1.5 pizzas 
E)  2/3 pizza

Question 10

The figure depicts a shift in a society's production possibilities frontier PPF) for the manufacture of trains and planes: train-manufacturing capacity expands while plane-manufacturing capacity shrinks. Refer to this figure to answer the next  questions.
 
-Which point represents an efficient level of output both before and after the shift?

Accepted Answer

A)  point A 
B)  point B 
C)  point C 
D)  point D 
E)  point E

Question 11

Opportunity cost is evident on the production possibilities frontier PPF) graph

Accepted Answer

A)  as we move from one point on the frontier to another point on the frontier. 
B)  as we move from the origin to any inefficient point. 
C)  as we move from one unattainable point to an efficient point on the frontier. 
D)  as we move from an inefficient point to the origin. 
E)  at any one single point on the graph.

Question 12

Use these production possibilities frontier PPF) curves, which compare the ancient production of agricultural products to art and literature, to answer the next questions.
A.
  B.
  C.
  D.
  E.
 
-Suppose the printing press is invented. Which graph best depicts how this would affect the PPF?

Accepted Answer

A)  Graph A 
B)  Graph B 
C)  Graph C 
D)  Graph D 
E)  Graph E

Question 13

At full employment, a society produces

Accepted Answer

A)  somewhere within its production possibilities frontier PPF). 
B)  somewhere outside its PPF. 
C)  at the origin on its PPF graph. 
D)  on its PPF. 
E)  only one good.

Question 14

Which scenario represents economic contraction?

Accepted Answer

A)  an outward shift of the PPF 
B)  an inward shift of the PPF 
C)  upward movement along the PPF 
D)  downward movement along the PPF 
E)  straightening of the curve of the PPF

Question 15

A poker player wins some cash. Which use of the money would most naturally be considered an investment?

Accepted Answer

A)  buying a round of drinks for everyone at a bar 
B)  using the money to play more poker 
C)  paying off debts owed to bookies 
D)  shopping for groceries 
E)  buying a book of tips for poker players

Question 16

Which of the following is NOT an assumption that economists make when developing a production possibilities frontier PPF)?

Accepted Answer

A)  We live in a world with only two goods. 
B)  There are no increases in technology. 
C)  There is no change in available resources. 
D)  Society will always be producing somewhere on the PPF. 
E)  There are no decreases in technology.

Question 17

Which of the following is a positive statement?

Accepted Answer

A)  An economist should test every theory at least twice. 
B)  Increases in the minimum wage cause unemployment. 
C)  We ought to deregulate the mortgage market. 
D)  The government must provide unlimited health care to citizens. 
E)  We should forgo some current consumption in order to invest in the future.

Question 18

Which of the following would NOT lead to an outward shift of a future production possibilities frontier PPF)?

Accepted Answer

A)  population growth 
B)  increased investment today 
C)  an increase in technology 
D)  the discovery of new resources 
E)  a decline in life expectancy

Question 19

Refer to the following figure to answer the next  questions.
 
-In the figure, point E is

Accepted Answer

A)  an efficient point. 
B)  unattainable with current resources. 
C)  an inefficient point. 
D)  the equilibrium. 
E)  evidence that trade does not enrich society.

Question 20

Refer to the following figure to answer the next  questions.
 
-In the figure, point A is

Accepted Answer

A)  an efficient point. 
B)  unattainable with current resources. 
C)  an inefficient point. 
D)  the equilibrium. 
E)  the point where society would prefer to consume.

Exam 2: Model Building and Gains From Trade

Mikhail and Stefan are both artists who can create sculptures or paintings each day. The following table describes their maximum outputs per day. Use this table to answer the next questions -What is Mikhail's opportunity cost of a sculpture?

The figures below depict the production possibilities frontiers PPFs) for two people who can allocate the same amount of time between building wooden boats and solving crimes. Refer to these figures to answer the next questions. -What is DiNozzo's opportunity cost for solving a crime?

A graph that shows the maximum attainable combinations of two goods when society efficiently uses its productive resources is called

When testing a model rocket on a campus quad, which of the following would be an endogenous factor?

The ability of one producer to produce a good at a lower opportunity cost than another producer is called

Economic growth is represented on a production possibilities frontier PPF) by the PPF

The figures below depict the production possibilities frontiers PPFs) for two people who can allocate the same amount of time between making pizzas and making stromboli. Refer to these figures to answer the next questions. -What is Kenzi's opportunity cost of making 1 stromboli?

Opportunity cost is evident on the production possibilities frontier PPF) graph

Use these production possibilities frontier PPF) curves, which compare the ancient production of agricultural products to art and literature, to answer the next questions. A. B. C. D. E. -Suppose the printing press is invented. Which graph best depicts how this would affect the PPF?

At full employment, a society produces

Which scenario represents economic contraction?

A poker player wins some cash. Which use of the money would most naturally be considered an investment?

Which of the following is NOT an assumption that economists make when developing a production possibilities frontier PPF) ?

Which of the following is a positive statement?

Which of the following would NOT lead to an outward shift of a future production possibilities frontier PPF) ?

Refer to the following figure to answer the next questions. -In the figure, point E is

Refer to the following figure to answer the next questions. -In the figure, point A is